This is a Cato Special Podcast. I'm Caleb Brown. Congressional action in addressing the economic damage brought by the novel coronavirus appears to misunderstand the nature of the economic downturn.

Chris Edwards directs tax policy studies at the Cato... the for many businesses won't do a whole lot when governments have also mandated the closure of

those businesses that provide the supply to keep the economy moving.

We spoke yesterday.

Well the government, the federal government was initially caught flat-footed and indeed

had a lot of they blocked the private sector response most famously the FDA restricted private testing for

coronavirus which everyone realizes now was a big mistake. So the Trump

administration was slow initially but they have reverse force and they are doing some good deregulation now to let the private sector respond.

But right now Congress is proposing a one and a half trillion dollar or so

sort of stimulus bill Republicans and Democrats are fighting over what the

contents of that are. I think a lot of the money will be wasted. The parties have agreed to mail out

$1,200 checks to every family in the country. I think that's every family under a certain income level.

I think that's a mistake. That sort of demand stimulus. But the economy doesn't need more demand now. It needs to bring

supply or production back online. I think the focus ought to be on allowing American businesses to open and

operate if they can do so in a safe manner. The government's responsibility

should be to make testing as widely available as possible and to pull out all the stocks in terms of the private business production of safety equipment and masks and all kinds of

other equipment that's needed for American businesses to operate safely.

So what should the government be doing with respect to supply?

Well, there's a lot of...

And when you say supply, of course you're referring to productive capacity to enable the exchanges that

this $1,200 that so many Americans are going to receive would other what is not

facilitating because as you say there is not as much production being

...